Irwin Mitchell, a national firm of solicitors, is calling for the immediate settlement of 85 outstanding clinical negligence cost claims by the NHS Litigation Authority, after the High Court overturned three earlier rulings in which the firm had successfully pursued claims but lost the right to recover success fees and insurance premiums from defendants. The solicitors had been prevented form recovering the costs after switching funding arrangements prior to the Legal Aid, Sentencing and Punishment of Offenders Act coming in to force.

The landmark judgement by Mr Justice Foskett comes at a time when the NHS has announced that it is setting aside almost a quarter of its annual budget – £26.1b out of a total annual health budget of £113b – to cover the costs of existing and future medical negligence claims against the health service. Over £1.3bn was paid out to cover medical negligence claims in the last year alone.

Each of the three clinical negligence cases had proceeded for several years before changes to funding rules in April 2013 when recoverability of ATE insurance and success fees was stopped. In each case the claimants had been successful, but they were prevented from recovering the success fee and after-the- event (ATE) premium after challenges were issued by the NHS Litigation Authority. However, a 10 per cent uplift was made to damages.

Prior to the introduction of the new Legal Aid, Sentencing and Punishment of Offenders regime, Irwin Mitchell had agreed to change from legal aid funding to a conditional fee agreement.

In each of the three cases the costs judges handling the cases – Master Rowley, Deputy Master Campbell and District Judge Besford – upheld the defendant’s challenge, arguing that the changed funding arrangements were not reasonable. However, in each case the claimants had not been told that one of the major consequences of changing from legal aid to conditional fee funding arrangements was that they would miss out on the 10 per cent damages uplift – established in Simmons v Castle – worth between £16,695 and £28,000 for the different claimants.

In the first of the three cases – Surrey v Barnet &amp; Chase Farm Hospitals NHS Trust – Mr Justice Foskett stated that the 10 per cent issue should have been mentioned to each of the litigation friends, however, the failure to do so was not a matter for the defendant but for them and their solicitors. Following the ruling, Irwin Mitchell said:

“The advice we gave was during a period of unprecedented reform in the legal sector but, if we were in the same position now with the same set of clients, we would give the same advice again.”

“The NHSLA has already settled a substantial number of similar cases with us and this judgment now sets out clear directions for how similar remaining cases should be approached. We hope the NHSLA will engage with us to resolve outstanding cases as soon as possible.”